Class Notes from Music Business Handbook

1. Music Copyright
 History:
 1790 Constitution Article I, Section 8
 …to promote progress of science and useful
arts…limited time….exclusive rights
 Major Revision 1909
 Most recent 1976, became effective 1/1/1978

2. What is Copyrightable?
 Original Works of Authorship
 What constitutes “Original” “Authorship”
 Not Ideas, but the “Fixation” of an
Expression of the Idea

3. What is Copyrightable?
 Literary Works
 Musical Works, including Words
 Dramatic Works, including Music
 Pantomimes & Choreography
 Pictorial, Graphic, & Sculptural Works
 Motion Pictures & Audio Visual

4. What is Copyrightable? cont.
 Sound Recordings
 Not under the 1909 Law, but protected by
other state statutes
 Architectural Works

5. What is Copyrightable? cont.
 Name of Band is Not
 Band Name is a Trade Mark/Service Mark
issue
 Original art of the Band Name Is

6. When is A Work Copyrighted
 When it is “Fixed in any tangible medium
of expression” . . . written, recorded, etc.
Proving the date of fixation is the problem.

7. Exclusive Rights
 Reproduce (Duplicate)(Mechanical Royalties)
 Derivative Works
 Distribute Copies
 Perform Publicly (Performance Royalties)
 Display Publicly
 Digital Performance Transmission of Sound
Recording (Congress considering extending to
all)

8. Exclusive Rights cont.
 Sound Recordings do not have right of
Performance Except Digital Transmission
 What does this mean?

9. “Fair Use” (p. 93)
 Certain Uses are Allowable
 Used For: Criticism, Comment, News
Reporting, Teaching, Scholarship,
Research
 No Strict Definitions

10. Two Musical Copyrights
 Form PA (Performing Arts): the work of
art (song: music & lyrics); songwriter
owns rights
 Form SR (Sound Recording): the
“fixation” of sound, not the underlying
song; performers, producer, record label
owns rights (depending on contract)

11. Fair Use
 “Fair Use” is a “Legal Defense” to
Infringement
 1. Purpose or Character of the use
 2. Nature of the Copyrighted Work
 3. Amount & Substantiality
 4. Effect on the Potential Market

12. Fair Use
Non Infringing Performances
 Remember these must meet the test
1. Performance or Display, Face-to-face
teaching, non-profit ed.
2. BUT, copying various chapter to make
your own textbook effects the textbook
market

13. Fair Use
Non Infringing Performances
2. Performance, display, transmission (non-
dramatic) if.
a. Regular part systematic instruction
b. Directly related to teaching content
c. Transmission reception is in classrooms

14. Fair Use
Non Infringing Performances
3. Performance (non-dramatic) religious
service.
BUT, copying songs from book effects the
print music market

15. Fair Use
Non Infringing Performances
4 Performance (non-dramatic) without
commercial advantage (payment for
performance)
a. No direct or indirect admission or
b. Proceeds (after production costs) not
used for financial gain

16. Fair Use
Non Infringing Performances
5. Performance (food/beverage musak or
TV)
a. Less than 3750 sq ft
b. If more than 3750
c. • less then 6 speakers, less than 4 per
room
d. • less than 4 TVs, 1 per room

17. Fair Use Chart For Teachers
 http://www.mediafestival.org/copyrightchart.

18. FAIR USE CASE
 Campbell v. Acuff-Rose Music, Inc (1994)
 Pretty Woman/Oh, Pretty Woman
 District Court held as Fair Use
 Court of Appeals, commercial nature
disqualified it
 Supreme Court: found the more
transformative the better, purpose &
character created a new work

19. Duration of Copyright (p.100)
 1909 law, two 28-year terms equals 56 years
 Published or registered prior to 1923 are “Public
Domain”
 1976 Law, effective 1/1/1978, with the 1998
Sonny Bono Copyright Term Extension Act
Duration Currently: Life plus 70

20. Duration of Copyright cont.
 “Work Made For Hire,” anon. or psuedo.
Shortest of:
95 yrs from Pub. or
120 yrs from Creation
 Published between 1923-1978 overlap
the new law. Granted 95 yrs.
 Copyright Chart

21. Ownership
 The “Bundle of Rights” can have multiple
owners. WARNING; always have a formal
agreement.
 Ownership of the copyright is DISTINCT
from ownership of a physical object
(master tape)
 “First Sale Doctrine” establishes rental
industry

22. Transfer Assignment
 Any of the 6 rights can be transferred or
assigned
 Written agreement
 File with Copyright Office

23. Termination of Transfer
 Any Transfer made after 1/1/78 can be
recaptured
1. A 5-year window between end of year
35-40
2. Right of Publication: 35 yrs from pub.
OR 40 yrs from execution

24. Termination of Transfer cont.
3. File “Intent to Terminate” not less than 2
yrs before or more than 10 yrs before
4. Contract language does not effect this
5. 1923-78, 5-yr window at the end of 75
yrs
6. “Work Made for Hire” cannot be
recaptured

25. Work Made for Hire (95)
 Employer is considered the author
(owner)
 Criteria
1. “Work prepared by an employee within
the scope of employment”
2. Work Specifically ordered or
commissioned” AND . . . .

26. Work Made for Hire cont.
AND must sign agreement stating “Work
Made for Hire”
Employee means SS benefits and
withholding taxes

27. Arrangements
 Arrangement is a “derivative work” no
ownership
 “Request Permission to Arrange” form
 For Recording a Mechanical License
replaces the above form
 Except Public Domain, may receive
royalties

28. Sound Recording
 The “Fixation” of the sounds (Form SR)is
different from the “Musical Work” (Form
PA)
 Rights: Reproduce, Derivative, Distribute,
Perform by Digital Audio Transmission;
no performance rights for other
transmissions.

29. Sound Recording
 The owner of the SR copyright can only
duplicate the exact fixation of sounds, not
another version.
 It is Legal to make a new recording that
imitates another without violating the SR
Copyright

30. Question
 What are the implications of only
Performance Rights for Digital
Transmission?

31. Quick View of Licenses
 Mechanical - to duplicate
 Performance - to play in public, live or
recorded
 Synchronization - putting music to
pictures
 Transcription - music for syndicated
programs & background music
 Master Use – to license a recording (SR)

32. Compulsory/Mechanical
License
 Owners have control of the first recording
 After, they are “Compelled” to grant a
license for recordings (not Transcriptions)
 Notify copyright holder of intent within 30
days (before or after), before distributing.
 Can’t find owner, notify Copyright Office

33. Compulsory Mechanical Rates
 2006 and later: 9.1¢ per song (5 min.) or
1.75¢ per minute

34. Mechanical Royalties
 Paid for each Phonorecord when “made
and distributed”
 Distributed Means “voluntarily &
permanently parted with its possession”
 Sale is not required, i.e., free goods
 Returned items are not “permanently
parted”

35. Negotiated Mechanical License
 Alternative is to Negotiate for lower rate
 Record Labels Want to Pay Lower Rate
on “Controlled Compositions”

36. Formalities (p.103)
n 1. Notice of Copyright
n On Printed Music
n © 2005 Sandy Schaefer
n On Phonorecords
n circle-P 2005 Sandy Records
n

37. Formalities cont
 “All Rights Reserved” adds protection in
foreign countries under Pan-American
Convention

38. Formalities cont.
 Omission
1909-1978 invalidated copyright
1/1/78 - 3/1/89 does not invalidate IF
• missing on small number
• registration made within 5 yrs AND
reasonable effort made
• owner requested no notice in writing

39. Formalities cont.
2. Deposit of Copies
Within 3 months deposit LOC 2 copies of
“Best Edition”
1909-1977 required sheet music
1978 - a recording

40. Formalities cont.
3. Registration
“is not a condition if copyright”
Works must be registered before one can
sue for infringement.

41. CRT, CARP, & CRB
 Copyright Royalty Tribunal, 1976-93
 Copyright Arbitration Royalty Panels, 1993
 Copyright Royalty Board, 2004
Both helped determine rates for:
1. Cable/Satellite, 2. Ephemeral sound
recordings, 3. Digital Delivery, 4.
Mechanicals, 5. Jukebox, 6. Educational
Broadcast

42. Infringement (p.107)
 Using Copyright Material Without
Permission or License
 Remedies: Injunction, Impoundment,
Destruction, Damages (Actual Damage or
Statutory Damages)
 Unregistered Works: No Statutory
Damages or Lawyers Fees

43. Piracy (p.108)
 Manufacture and Sale of Phonorecords
without permission or License
 1982 Piracy & Counterfeit Act
 Max $250,000 & Jail

44. Audio Home Recording Act
1992
 Allowing home duplication
 Royalty payment & “Serial Copy
Management System”
 Dual CD Recorders use SCMS
 “Audio” or “Music” CDs include a Royalty
divided between featured and non
featured players

45. Trade Names Trademarks
 Naming Band
• DBA or Fictitious Name Form
• Check with Unions, ASCAP, BMI, SESAC
• Library: Index to the Trademark Register

46. Band Names
 Written Agreement:
 Who Owns Name,
 How is Ownership Shared,
 How Does it End
 What Happens when People Leave the
Group

47. Copyright Forms
 http://www.copyright.gov/register/
 Register online $35 eCo (electronic
copyright)